Petrobras Will Invest US$ 27 Billion in Pre-Salt and US$ 20 Billion in Post-Salt

Petrobras Expects to Invest US$ 27 Billion in Pre-Salt and US$ 20 Billion in Post-Salt Over the Next Five Years. With Plans to Sell BR Distribuidora and Reduce Expenses and Cash, the State-Owned Company Is Restructuring to Focus on Oil Extraction.

The oil company is expected to have 11 more production systems during this period, with seven in the pre-salt. “Our agenda is based on exploration, a focus on the pre-salt, and digital transformation,” said Rudimar Lorenzatto, director of the state-owned company. The firm is expected to have 62 offshore exploration wells between 2020 and 2023. According to him, Petrobras is preparing for a 20% increase in global energy consumption over the next 20 years.

Petrobras Awakens

One of the world’s leading oil companies and the largest company in Latin America, Petrobras returned to profitability after four years of losses, loss of value, increased debt, and involvement in the largest corruption scandal in the country, investigated by Operation Car Wash. The company made a profit of R$ 25.78 billion in 2018, the best result since 2011, when it earned R$ 33.31 billion.

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Petrobras is expected to release, after the market closes this Tuesday, May 7, the weakest quarterly results. However, investors are really interested in the outlook for the future of the state oil company, which has improved significantly in recent weeks.

The new momentum of the company’s restructuring process this year is making the bad short-term news less significant. With measures to cut costs and strengthen cash flow, investment bank Itaú BBA estimates that the company’s debt will decrease by 26%, to R$ 219.8 million, between 2018 and 2021. With a lighter debt load, Petrobras can seek new opportunities and focus on enhancing its core business, which is oil extraction, increasing profitability for investors.

It is a comeback when considering the company’s situation four years ago, in April 2015. At that time, Petrobras was finally announcing, with a five-month delay, the 2014 result: a loss of R$ 21.58 billion, including a calculated loss of R$ 6.2 billion due to corruption. It was the first negative result since 1991.

Now, Petrobras is preparing to increase production, reduce costs, and invest US$ 82.7 billion (about R$ 330.36 billion) by 2023. Company estimates show production growth of at least 6.47% this year.

On the other hand, it needs to deal with criticism of its fuel pricing policy, which has played a central role in the controversies surrounding diesel and gasoline price increases.

Government Expects to Raise R$ 1 Trillion in 30 Years with the Exploration of Four Pre-Salt Blocks. According to Minister Bento Albuquerque of Mines and Energy, the proposal is to share up to 70% with states